Audit 11-09 Review of SBA Controls over Cash Gifts 3/18/11

This report represents the results of our audit of SBA controls over cash gifts. SBA has gift authority under sections 4(g), 8(b)(1)(G), 5(b)(9) and 7(k)(2) of the Small Business Act (the Act). Employees may solicit and accept gifts on behalf of the SBA after proper approvals, including a conflict of interest determination by SBA’s Office of General Counsel (OGC). All gifts must be used in a manner consistent with the Act and any terms imposed by the donor. Section 4(g)(2) of the Act provides that any gift, devise, or bequest of cash accepted by the Administrator shall be held in a separate account[1] and shall be subject to semi-annual audits by the Inspector General who shall report his findings to Congress.

Our audit objective was to determine whether SBA was following established procedures for soliciting, accepting, holding and utilizing cash gifts.To achieve our audit objective we obtained an understanding of laws, regulations, and SBA policies and procedures regarding its gift authority. We also interviewed selected SBA officials and examined documentation obtained from officials in the Offices of Strategic Alliances; Advocacy; and the Chief Financial Officer. Lastly, we examined 16 cash gifts that were posted to the BAT Fund between October 26, 2010 and January 7, 2011. These gifts were utilized by SBA’s Office of Advocacy (OA) in support of the 30th Anniversary of the Regulatory Flexibility Act of 1980 and the 2010 Jobs Creation Symposium.

[1] This account is called the Business Assistance Trust Fund (BAT Fund).